The present invention relates generally to product planning and, more particularly, to methods, systems, and computer program products for implementing a reusable new product planning model.
Typically, demand for products of a similar type varies more at the product level than at the aggregate level. Therefore forecasting the demand for a complete set of products, e.g., mid-range servers, is easier than forecasting the demand for a single product within that product set. When a new product is introduced into the product set, forecasting demand for each individual product becomes even more difficult.
Planning techniques for predicting new product introduction volumes, the transition speed by which a new product replaces a series of related older products, and the associated end-of-life of volumes have been characterized by manual, disparate processes. Existing planning process can be based on trial and error, personal prognostications, or manual spreadsheet tools, to name a few. These processes are difficult to repeat and share across a corporation and generally have problematic results during new product introductions. Planners have not had a reusable method for predicting new product introduction effects on existing products; nor have they had techniques to view the total demand for the set of products and to determine how best to allocate the overall demand down to the product level.
Predicting the volumes for all products, new and old, in that period of introduction/transition is critical for the successful launch of a new product, and has implications on the extended supply chain. For the new product, ensuring supply, manufacturing, and distribution capacity matches market demand is crucial to capture market share and satisfy customer expectations. For the related products that are already in the market, the supply chain must make accommodations for slower growth or reduced levels of capacity to assure that capacity is not over-shot leading to obsolete inventory and write-offs.
What is needed, therefore, is a way to predict the demand of new products the associated effects on existing, related products in a product set in order to ensure greater accuracy in the production planning processes for these products.